Direct application not progressing, could we consult a broker?

carrot_cake

Hi all
Me and my husband had an appt with a Nationwide mortgage advisor 2 weeks ago (our current lender). We were told that we could not submit a formal application because we had to wait for the overpayment monies on our mortgage to be transferred back to us.
I will try to explain our situation briefly.

Current mortgage - £162k
Sold our current house for £248k
Overpayment £33k (to be used as part of the deposit)
Gift from parent £10k
New house price £288k

We only want to borrow the same amount as our mortgage is now and do have some savings as well. Now on paper, we cannot afford this mortgage (our circumstances have changed since we took the current mortgage out). However, we have been paying this mortgage with no problems or defaults etc.

My husband has a great credit history but I do not I checked my credit file last week through equifax and although all my accounts are up to date now, 2 mail order accounts have lots of late payments showing (completely stupid of me I know). One of these accounts is still showing as "in arrears" even though I cleared the balance in May. I'm presuming it hasn't updated yet

I'm concerned that we will be turned down when we do actually apply and also at the length of time it has taken so far (and being no further forward). My question is, could we consult a broker whilst this is going on and could someone recommend one who may be able to help?

TIA

kingstreet

Nothing to stop you talking to a broker.

Ask friends and relatives for a recommendation in your area, failing that try https://www.unbiased.co.uk, switching off the "sponsored ads only" option so you get the full list, not just the ones who pay.

ACG

Your income needs to be enough to afford the mortgage, broker or not it has to pass the same affordability.

How much is your income?

carrot_cake

Thanks for that. I just clicked through your link and typed in my postcode(switching off sponsored ads) and there is a very large list. Should I be looking for mortgage broker (whole of market), mortgage advisor, financial advisor? They have all been listed even though I clicked to find mortgage.

TIA

kingstreet

Anyone who offers an independent or whole market service.

Independent means they charge you a fee and rebate to you any commission paid to them for introducing your case to a lender. They can also recommend non-commission paying products but you'd have to arrange that yourself directly with the lender.

Whole market means you pay a lower, or no fee to the broker and the broker receives commission from the lender. You would need to do your own research into direct products if you choose this route as the broker will not source them for you.

Have a ring around and chat to a few. Talk to them and get a feel for if you want to deal with them. Ask them to email you a copy of their Initial Disclosure Document as this explains what they do, how they do it and how they get paid. A decent broker will offer it to you in your first contact with them.

carrot_cake

ACG wrote: »

Your income needs to be enough to afford the mortgage, broker or not it has to pass the same affordability.

How much is your income?

My husband's is 19,000 (self employed) and mine is only 5,000. I only work part time as I am a carer to our child with severe disabilities. The lender's advisor did say they would probably take the allowances into consideration. With these it probably pushes mine up to around 17,000. I suppose the fact we have a large deposit will not hold much sway then?

kingstreet

This is from Nationwide criteria on benefit inclusion in income;-

Benefits

Please note: Applications where income is made up primarily of benefits and maintenance are likely to be declined.

The following allowances are accepted, and should be keyed under benefit income. We will be cautious where payment of an allowance is subject to regular review, but if we are satisfied that withdrawal of the allowance is unlikely, we will include it as income in the Affordability Calculation.

Tax credit and allowances

This refers to Working tax credit, Child tax credit, Child benefit and Pension credit.

As proof, we require each page of the latest award letter, we will exclude an allowance if the applicant has been told that its payment will cease on a stated date in the near future. All named on the mortgage must be named on the Working and Child tax credit award letters to be accepted. If there are additional parties on the award letter not named on the mortgage, this income is unacceptable.

State Benefits Specifically for the Disabled

The following benefits paid because of a disability are an acceptable source of income provided the applicant can show a current letter of entitlement:

Incapacity benefit
Disability living allowance for a person aged 16 or over
Disablement living allowance on behalf of a child under 16
Attendance allowance

If the applicant has been told that its payment will cease on a stated date in the near future it will be excluded from the affordability calculation.